Corporate Governance and Executive Remuneration: Rediscovering Managerial Positional Conflict
Jennifer G. Hill
University of Sydney - Faculty of Law; European Corporate Governance Institute (ECGI)
Charles M. Yablon
Yeshiva University - Benjamin N. Cardozo School of Law
November 15, 2010
University of New South Wales Law Journal, Vol. 25, p. 294, 2002
Vanderbilt Law and Economics Research Paper No. 03-02
Like the US, Australia has in recent times experienced a number of dramatic corporate collapses, such as HIH and One.Tel, in which executive remuneration appears as an interesting subtext. While there has been a tendency to view executive remuneration as a specialized topic, its connection to these corporate collapses emphasizes the fact that executive remuneration presents general corporate governance problems in a highly concentrated form.
This article, which discusses a number of recent scandals and developments relating to executive remuneration in Australia, argues that segregation of executive remuneration from other areas of corporate law may lead to dangerous tunnel vision. Professor Eisenberg has spoken of management's positional conflict of interest, due to management's broad range of discretions and relative autonomy within the public corporation. The article considers some ways in which management's positional conflict of interest, particularly in the area of disclosure, may interact with (and potentially subvert) the goals of contemporary performance-based pay schemes.
Number of Pages in PDF File: 40
Keywords: Corporate governance, corporate scandals, CEO compensation, executive remuneration, performance-based pay, stock options, managerial positional conflict, disclosure
JEL Classification: G34, G38, J33, K22, K33, M52working papers series
Date posted: February 11, 2003 ; Last revised: November 17, 2010
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